Panama's new president, Mireya Moscoso, accepted two white keys from US Ambassador Simon Ferro as a symbolic gesture of the handover. "This event is another link in the chain of events that guarantee our sovereignty and independence" said the President. For decades, the air force base at Fort Kobbe served as the front line of defence for the southern United States. From there, Washington intercepted South American drug traffickers and defended the vital Panama Canal.

The handover of the keys marked the cessation of US presence in the Republic. The official date for the takeover is 31 December, although the formal ceremony will take place on 16th December, attended by a prestigious world-wide audience.

A minor but influential band of Republicans in Washington maintain that the US withdrawal represents the opening of a breach in national security. They argue that the bases constructed to replace Panama's facilities cannot endeavour to control the flow of drugs up the central American isthmus. They also believe that the Panamanian police force will not succeed in defending the waterway.

There is no Panamanian army. However, the US does have an escape clause: according to the original treaty, Washington can move back in unilaterally if at any time it considers that the canal's security or its neutrality are threatened.